Contribution Of Tech To StanChart Kenya’s Profits

Standard Chartered Bank Kenya Limited has released its full year results for the year ended 31^st December 2023. The bank has registered a 32 per cent increase in its net interest income, which has been contributed to by its investment in digitization of its products.

In 2023, the bank made significant investments in its digital strategies something that the Chief Executive Officer, Kariuki Ngari, says led to a 20 per cent rise in operating expenses.

“We delivered a strong performance in 2023 with Profit Before Tax up 15 per cent year on year to KES 19.7 billion ($141.7 million). Our top line growth of 23 per cent benefited from strong business momentum coupled with improved margins. Our continued investment in a strong digital proposition and the impact of inflation led to a 20 per cent rise in operating expenses. Loans and advances were up 17 per cent, while deposits grew by 23 per cent, demonstrating that we continue to provide value to our clients,” Ngari said.

According to Ngari, the operating expenses rising by 20 per cent reflects on the impact of inflation as well as increased investment spend on digital capabilities.

“We have invested in digitizing all our processes including the experience of the staff. This was seen during the COVID-19 pandemic and we are still operating on a hybrid environment. We all know that technology keeps changing so we still have our ears on the ground to invest in the newest relevant technology so that we stay ahead of the curve in terms of technology adoption,” the Standard Chartered Kenya CEO further noted.

Speaking to a CIO Africa reporter at the bank’s Head Office in Kenya, Jaine Mwai, the Chief Information Officer (CIO) of Standard Chartered Bank Kenya, supported Ngari’s statement saying that the digital strategy the company engaged in is now starting to bear fruits.

“In our digital strategy, we have invested in digitizing all our products both within the corporate space and the retail space. If you take an example of the Shillingi product, it has grown exponentially because of how technology penetration in the country (Kenya) has also grown. We have an app where we list all these products and our customers can access most services through the app. This has played a part in the growth of our YoY profit,” Mwai said.

“Just yesterday, we did an upgrade on our core-banking system as we move to the cloud. We will keep on investing in technology because we also want to give the best services to our customers,” she added.

With comparison to the year ended 31 December 2022, the Standard Chartered Bank Kenya has: realized a net interest income increase by 32 per cent due to growth in asset volumes & improved margins; increased its non-interest income by 6 per cent due to growth in transaction volumes, favourable market movements, & robust performance in the Wealth Management Business; increased operating expenses by 20 per cent reflecting the impact of inflation as well as increased investment spend on digital capabilities; and increased its impairment losses on loans and advances by $15.1 million (KES 2.1 billion) reflecting continued active management of the credit portfolio.